Your HR and Payroll compliance and policy solution! Comply with federal, state, and international laws, find answers to your most challenging questions, get timely updates with email alerts, and more with our suite of products.

TECHNOLOGY, TELECOM AND INTERNET BLOG

Mar 25, 2016 / by

NETFLIX THROTTLING ADDS NEW TWIST TO NET NEUTRALITY DEBATE

A chorus of Internet service providers and supportive
policy groups are crying foul after the Wall Street Journal reported that
Netflix Inc. has been slowing down, or “throttling,” its streaming video speed
to subscribers who use AT&T and Verizon Communications wireless services.

The ISPs are up in arms because Netflix has
been a staunch champion of the Federal Communications Commission’s net neutrality
rules, which prevent the ISPs themselves from slowing traffic moving across
their networks.

It turns out, according to the report, that
the streaming video giant has for more than five years been slowing those subscribers’
video traffic to 600 kilobits/second broadband speeds—just barely above the
minimum 500 kbps speed Netflix says customers need to use the service.

In a March
24 blog post, Netflix spokeswoman Anne Marie Squeo said that speed was the “default
bitrate for viewing over mobile networks,” and that Netflix slows mobile video traffic to help consumers
avoid going over their monthly data caps, which could result in hefty
additional fees. The company declined to comment aside from the blog post.

ISPs could
receive a hefty fine under the net neutrality rules for similar practices, but Netflix
faces no such danger, at least not for the throttling itself. The net
neutrality rules only apply to ISPs and those who control access to the Internet, not to companies that
operate over it, like Netflix or Google Inc.

Netflix’s practice
does, however, add a new wrinkle to the debate over how, who and when federal
authorities should regulate in the Internet ecosystem.

Netflix—whose
traffic alone accounts for 37 percent of wireline Internet use in North America
in 2015, according to Sandvine, an Internet traffic management firm—was one of the
lead proponents of stricter regulations for ISPs under Title II of the
Communications Act, including a bright-line prohibition on throttling online
traffic by broadband providers, due to what Title II advocates said is ISPs’ unique
gatekeeper status for Internet access.

Some ISPs
and Title II opponents have countered that the practices banned by the FCC could
be beneficial to consumers, a fact some were quick to point out in response to
the Wall Street Journal report.

“Netflix
fought hard during the open Internet proceeding to ensure that broadband
providers could not engage in this same behavior that would benefit the same
customers in the same way,” said Doug Brake, a telecom policy analyst with the Information Technology and Innovation
Foundation, a Washington think tank.

“Most content providers already build adaptive bitrate
algorithms into their streaming service, allowing the video to adjust its
resolution to the network conditions. Adapting streams with a hard cap on data
rates for resource-constrained mobile networks is not much different,” Brake
said.

Even some of
the groups criticizing Netflix for the hypocrisy of the policy advocacy said the
company’s mobile video throttling wasn’t inherently wrong. They did, however, question the company for not disclosing the practice to its subscribers.

And the lack
of disclosure, rather than the throttling itself, could be what gets the video
Netflix in trouble with the feds— namely, the Federal Trade Commission.

All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to books@bna.com.

Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)

Notify me when updates are available (No standing order will be created).

This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to research@bna.com.

Put me on standing order

Notify me when new releases are available (no standing order will be created)